The New Depression is On, Y'all...

So sayeth Carl Weinberg, chief economist at High Frequency Economics, to CNBC (h/t: Ace):

“Our view is that unfunded guarantees are worthless. Raising resources to fund the EFSF and the associated SIV will require diverting savings – domestic European savings, for the most part, not Chinese savings, and not those kept on reserve at the IMF – from either domestic consumption or investment,” he said.Raising that money within the next year from European savers will have a major effect on jobs and incomes as output and demand drop sharply, according to Weinberg, who believes that Europe will be back in crisis sooner rather than later.“We predict a catastrophic contraction of GDP in Euroland in a combined monetary and real-economy event," he said. "The event we envision is much more akin to the Great Depression of the 1930’s than to any business cycle we have experienced in our lifetimes.”

And what happened after the Great Depression in Europe?

I say we let the Germans win this time. Help them out, if possible.

Because the Only Way to Decrease Rape is to Rape More People...

Sheriff Joe Biden, the executive branch's most prominent FailBot, rides again.

Biden's reasoning -- that more rapes will undoubtedly occur if the federal government doesn't subsidize law enforcement -- doesn't pass the smell test. For that matter, I didn't know feminists were so approving of the way our law enforcement systems handled rape cases.

But these are difference that the reality-based community can surely paper over.

BY THE WAY: Biden's facts are wrong.

The Department of Education: Unsurpassed in their Achievement of FAIL

Throughout the 1980's every proggie worth his No Nukes T-Shirt used to sniff urbanely at the level of education spending versus the level of defense spending. "If we can spend this much on the military," went the refrain, or "for the cost of a B-1 bomber..." implying that if only the magic money spigot could be turned on, American education would return to the world's forefront.

The meme, repeated often enough, lodged itself in the collective unconscious, and behold: Federal defense spending now stands at 190% of what it was in 1970. The result?

Bupkis. (h/t: Protein Wisdom)

That's zip, nada, nothing. We've increased education spending by an order of magnitude and test scores remain as flat as a pancake pressed in a panini machine by a 2-dimensional hyperintelligent shade of the color red.

And when Reagan made large cuts to ed. spending in the early 80's? Nothing happened. When the GOP Congress made slight cuts in the mid-90's? Yet more nothing happened. 

So if the Department of Education vanished overnight, does anyone pretend that our educational output would change to any appreciable degree?

Thieves, Liars, Whores, Swine and Gilded Fools: A Four-Letter Dissertation on Politics

August is traditionally the time of vacation, down time, relaxing. I need such most greatly, for a variety of personal reasons. So this post may be considered my declaration of farewells, for the nonce. I've learned that for me, blogging is a cyclical activity.

But first, it is time to take stock of the inanity which has prevailed before us, of the Debt-to-GDP ratio hitting 1-to1, of the thousand manifold bottles of snake-oil that the New Class has sold us. Walter Russel Meade has a fine dissertation on "The Progressive Crisis" (h/t: Ace), which the usual suspects of the droit-osphere have linked approvingly to. He correctly points out what Ayn Rand pointed out 60 years ago: that there is an unspoken will-to-power in the Progressive Movement. Our Saviors are as corrupt and wicked as the rest of us, and the people know it.

Barack Obama is full of shit. Harry Reid is full of shit. Nancy Pelosi is so full of shit she could fertilize Death Valley. Now, as it happens, being full of shit goes with the territory of politics, because politics is shit. Hunter Thompson, who had a Ph.D in Being Full of Shit, nevertheless once wrote something in Fear and Loathing in Las Vegas about the profession of journalism that I quote approvingly:

Agnew was right. The press is a gang of cruel faggots. Journalism is not a profession or trade. It is a cheap catch-all for fuckoffs and misfits -- a false doorway to the backside of life, a filthy piss-ridden little hole nailed off by the building inspector, but just deep enough for a wino to curl up from the sidewalk and masturbate like a chimp in a zoo cage.

But a few shifts in nomenclature and metaphor would suffice to make this an utterly apt description of politics. Politics is a bunch of glad-handling buffoons, flannel-mouthed ward bosses, and dipshit crusaders. There's but a few of any rank anywhere in the City of Washington that the country would miss if they all spontaneously combusted tomorrow.

This is not a matter of replacing one group of swine with another. I still haven't decided whether John Boehner is full of shit yet (odds are, yes). The nature of the activity is inherently corruptive. To rule others, one can adopt one of two strategies: letting the traditions of your people guide your every action, or attacking every vested interest not on board with your self-aggrandizing agenda. The first is mere office-holding, the second is tyranny. Progressives of every stripe keep declaiming that they have found the Third Way, and more bodies have been littered in that fruitless Grail-Quest than frozen ships seeking the Northwest Passage. It is a fantasy: nothing more than tyranny in a velvet glove. Politics is shit. Inhale deeply.

And that is why I could never muster the anger at someone like Charlie Rangel or Robert Byrd. Rangel is a thief, and a racist thief at that. But I suspect that, in some deep-down, cameras-off world that neither you nor I will ever see, the son of a bitch knows he's a thief, and justifies his thievery on the same grounds that I have offered: he must swim in the same seas as everyone else. That he's a fat little fishy in a sea of shit does not change the odeur of the water one jot.

So sure, catch the fat little fishy if you wish, mount him to the wall. Send his ample ass to jail: why not? That oily bastard lives by our sufferance, which we the people, in our limited wisdom but unlimited sovereignty, can withdraw at any time we see fit. Just you remember: there are plenty of fish in the shitty sea.

No, I have no animus for the Rangles and Byrds of the world of politics. Thieves are thieves, and eventually they end up robbing themselves. I reserve my true hate for the ones who claim not to hunger for graft or power but for a Square Deal for all Americans, the ones who claim that it is time to put politics aside and do the People's Will. Proggies have been shilling that line for a century, and it's the biggest pile of dinosaur shit there is.

The People don't have One Will; that Rousseauist fantasy builds nothing but guillotines. The People are a multiverse of conflicting dreams, desires, and ideology. They have no Main Line from which silken-voiced princes with first-rate temperaments can eternally suckle. 40% of them hate Democrats, 40% hate Republicans, and the rest would rather everyone just play nice. You cannot claim a Mandate to do whatever the hell you please on the basis of winning 51% of such an electorate. It is a house built on quicksand.

The People's Will is a fantasy, and I hope that Obama knows it. Bill Clinton did. That man was as gifted a liar as politics has seen in a while, but he was a better whore. And whores know that it doesn't matter what the john wants if you get extra for the service. So if the john wanted to hear that The Era of Big Government was Over, then Billi would make that sound pretty coming out of his mouth. He knew the tricks; he knew the game; the People (or 60% of them) loved him.

Right now, 50% of the People are fucking sick of Obama, of his fecklessness, his emptiness, his inability to handle one thing with anything approaching success. What the Sam Hell are we doing in Libya? Who the hell knows? Who's in charge? What the hominy fuck happened with ObamaCare? Did Obama even read an executive summary of it? And precisely what about trillion-dollar deficits does this simple bastard love so much?

The worst of all politicians, worse than Thieves, Liars, Whores, or other Associated Swine, are the Gilded Fools: the Bobble-heads, the ra-ra true-believing priests of the Progressive Leviathan. Fools there are aplenty in Washington, and every state house and city hall for that matter. Dennis Kucinich is one such, as is John Edwards (Sarah Palin might be, as well). But these are more or less harmless, as they quickly up-jump their place and show their true motely colors. But sometimes, press or party takes a Fool and Gilds him, makes him shine brighter than the Sunne in Splendour, and the 20% that just wants everyone to play nice will swoon like a 12-year-old at a Justin Bieber concert (In Edwards' case, the gilding did not work, perhaps because a gelding was more in need). By such precise means did a junior senator with no executive experience and a middling legislative experience parlay a MLK-timbered voice into the highest office in the land. The story was too good. We just had to believe that he knew what the hell he was doing.



And now we sit, with a government broke and broken, about to fundamentally disprove Hamilton's postulate that a national debt could be a national treasure (or for those who know the context of that remark, fundamentally prove it). And we are shocked, shocked I say, that the warring tribes cannot negotiate with one another. We can't believe that there's actually a dimes worth of difference between the two.

Well, there is. The GOP has no shortage of Thieves, Liars, Whores, and Swine. Duke Cunningham was a Thief; Gingrich was a Liar, and the Maine Sisters (Snowe and Dukakis) consistently sell their virtue to whatever trawler comes by. But the GOP doesn't get to Gild many Fools, because the gang of fuckoffs and misfits don't usually let them. The rest may or may not actually mean what they say about shrinking the size of government.

Yet even Swine can find a truffle, and the gang of elephants has stumbled upon the reality that eludes the current Gilded Fool: We cannot afford the size of the government we currently have. Not even if we expropriate the wealth of the nation can we afford it. You can only loot Microsoft once. It won't be there to feed the current services baseline next year.

Robert Stacy McCain has a succinct phase for this reality: The State is not God. Get over it. The State can't do everything or satisfy everything. It has limits intrinsic to its nature, which are thievery, force, and lies. You can accomplish much with thievery, force, and lies. But you cannot uplift the human spirit with them. They do not nurture the true and good. They will not succor the middle class, or any other class. They will work only until there is nothing left to steal, no force left untried, and no lie still believed.

And on that note, I take my leave. I will leave Revolutionary Nonsense fallow for a few weeks, but will return by Labor Day at the latest. Enjoy the the Dog-Days.

"Federally Funded Condoms for Pre-Teens"

(h/t: The Other McCain)

It's the Spending, Stupid!

Tea Party Nation founder Judson Phillips addresses the elephant in the living room. (h/t: Memeorandum)

I feel confident in saying that the Tea Party understands what so many in Washington seem to have forgotten: We do not have a debt crisis. We have a spending crisis. There is only one way you get to a debt crisis — you spend too much money.

There's a word for having to explain something brain-blitheringly obvious to those who refuse to see it:

Alexis McGill Johnson Doesn't Know What Words Mean

Legal Insurrection: (h/t Protein Wisdom)

During a Great American Panel on Hannity tonight John Fund and Hannity were hammering the point that Obama doesn’t know how to negotiate in good faith. One of them mentioned Donald Trump’s criticism that Obama doesn’t know what he’s doing because Obama’s never done a “big deal.”

Panelist Alexis McGill Johnson of the American Values Institute responded:

"He got bin Laden."

Leaving aside the rhetorical effectiveness of Obama's manful crowing about "getting" bin Laden, Johnson seems to have been unaware that Trump meant "big deal" in its literal sense: large-scale financial negotiations. Sending Seal Team Six to whack bin Laden has nothing whatever to do with finance or with negotiation, so far as anyone knows.

So either Alexis McGill Johnson lacks the contextual awareness to pick up on the ordinary plain meaning of words, or she's playing a desperate game of distraction on behalf of Emperor Golden Dancer.

Up to you.

Are We Going to Default?

Maybe.

If we do, will that suck?

Assuredley.

Am I panicking over it?

Oddly, I'm not.

There's a kind of cosmic justice to all of this, that our government is so fundamentally divided that it cannot agree on how to undo the mammoth debt we've accrued. America has been a house divided against itself for some time; with progressives hungrily constructing their Leviathan and conservatives desperately trying to find a magic bullet that will kill the beast. Eventually, so powerful a discord creates positions across which no bridge can span. Somebody's going to win; we're all going to lose.

It's a thing called hubris.

Just in Case You Were Wondering Why This Debt Ceiling Debate is Happening...

...this is why:

This is why those radical right-wing teabaggers are so insistent on spending cuts, on not raising taxes. This is why our debt-to-GDP ratio is at 100%. This is why, pretty much everything.

And whatever anyone has to say about what we should do now, anything that fails to address this basic fact is inherently inoperative.

Enjoy the kabuki.

I Can't Quit John Boehner ....

Every time I decide he's gonna sell us down the river, he gives us one of these: (h/t: Drudge)

“As I read the Constitution, the Congress writes the laws and you get to decide what you want to sign,” Boehner said, recounting what he told the president, according to two sources.

That sounds like a man who's sick of negotiating.

Is there a Debt-Limit Deal?

No.

There isn't a deal until there's a deal.

Until the President and the Speaker say "We Have a Deal" (Reid and McConnell will do as they're told), we do not have a deal.

And since we do not have one until it exists, its pointless speculating about what's in it. We will not know until we can see for  ourselves who has stood, and who is screwed.

The Gang of Six Plan is a Joke

Which is why it will probably pass. It does one or two useful things, one or two not useful things, and dicks around with the most needful thing, which is cutting spending and reforming entitlements.

Dan Mitchell has the details. (h/t: Protein Wisdom)

"Forget lifeboats. We need to rearrange these chairs!"

UPDATE: Ezra Klein tries to spin the thing, and it remains as stationary as a Soviet monument: (h/t: Memeorandum)

Then the Budget Committee is charged with drawing up legislation to extend the caps on discretionary spending — which cover both defense and non-defense, and, if I understand this right, cut more than $1 trillion from projected spending — until 2021, and to draw up an enforcement mechanism that will kick in if deficit reduction isn't on track come 2015. Come 2020, federal health spending is put on a global budget, with growth not to exceed GDP plus 1 percent. Finally, once all that's passed, the Finance Committee is asked to produce legislation making Social Security solvent for the next 75 years, and their product is assured certain procedural advantages. There's very little in the way of specifics here, but there's an odd line suggesting that if this effort fails, then the vote on the whole deficit-reduction plan is invalidated.

In other words, most of the big savings come from telling the Senate Finance Committee to find said savings later on, and pinky-swearing that they'll make it easy for them to do so. The $500 billion up-front savings come mostly from some accounting tricks, including a reduction in Social Security's COLA adjustment.


And how is that markedly different from the House GOP's "Cut, Cap, and Balance" plan? A few ways:

1. Raising the Debt Ceiling is contingent on a Balanced-Budget Amendment. The BBA outlaws deficit spending and requires a two-thirds vote for tax increases.
2. The Up-Front Savings come mostly from non-defense discretionary spending. Such spending is reduced to FY2008. The actual number of savings is less, $111 billion to $500 billion, but the savings are more real.
3. This is acknowledged as the beginning of fiscal sanity, not the end of it. Obama has been touting a "big plan" so he can say that he "made hard choices" during next year's campaign. He wants to pretend that our nation's fiscal health can be tied up in a pretty package with the word "DONE" on the label.

In other words, CCB requires making actual spending cuts, while GO6 requires pretending that we have already made them.

Meghan McArdle Discovers That Spending Cuts Means Cutting Spending

Actually, she yells that the sky is falling, and blames the Republicans. For wanting to cut spending. (h/t: Memeorandum)

The GOP will have taken a chance at meaningful entitlement reform and a mostly-spending budget deal, and thrown it away for literally no gain.

What chance at meaningful entitlement reform was that? The one where Obama mocked Paul Ryan? The One where Obama offered a budget that the CBO said was ungradeable? The one where the Senate Democrats ignored the budget that the House passed?

Does that mean that I'm shilling for the Democrats and saying you can never cut spending?  Hardly.  But you cannot cut spending by 40% in the middle of a recession.

I'd take a 2% spending cut in real dollar terms. If Obama offered that, instead of magical next-year spending cuts that will never actually cut spending, there'd be no debt-ceiling argument. Eric Cantor suggested that, and Obama stormed out of the room like it was his party and he'd cry if he wanted to.

So yeah, Megan, that makes you a shill for the Democrats who never permits cutting spending. Because as soon as the possibility of actually cutting spending appears, you squeal like the angels are busting open the seals.

And then women will be forced to back-alley abortionists,
human sacrifice, dogs and cats, living together...

Preach, Brother.

Over at Ace of Spades, they've been preaching Jeremiads on the DOOMED Debt cycle for some time. It has of late crossed into the mainstream. In the WaPo, Robert Samuelson tells it like it is:

We in America have created suicidal government; the threatened federal shutdown and stubborn budget deficits are but symptoms. By suicidal, I mean that government has promised more than it can realistically deliver and, as a result, repeatedly disappoints by providing less than people expect or jeopardizing what they already have. But government can’t easily correct its excesses, because Americans depend on it for so much that any effort to change the status arouses a firestorm of opposition that virtually ensures defeat. Government’s very expansion has brought it into disrepute, paralyzed politics and impeded it from acting in the national interest.

When the end comes, we will lose things that we like. We will lose benefits we have come to depend on, tax breaks that we treat as our due. The fact that we were fools for ever trusting Caeser in the first place will not make it hurt the less.

Read the whole thing.

Budget Popcorn: Butter or No Butter?

If the GOP was going to follow-up the Budget deal with some real cuts, they'd get right to it, wouldn't they?

Behold:

“This is about making the right decisions now,” Cantor said. He touted Rep. Paul Ryan’s, R-Wis., budget proposal — a plan released last week that contains about $6 trillion in spending cuts over the next 10 years — and suggested Republicans would fight for at least a chunk of that plan as a condition of their support on the debt limit vote.

Cantor said a portion, and I think a portion is all he and Boehner expect to get. Which is what any sane person would expect when the Democrats control the Senate and the White House. Shutting down Pelosi (notice how absent she's been from these debates?), and hemming in Obama and Reid are about what Boehner can do. And I can tell that it's working, because:

“It’s totally unbalanced,” Van Hollen said. “He ends the Medicare guarantee for seniors. … They’ll have to eat all of the rising costs of health care, while they provide big tax breaks for millionaires and the corporate special interest."

This is what those triumphant donkeys of 2007-2010 are reduced to; muling and fussing about grampa's pills. Their backs are up against the wall, and they've got nothing to do but point to a weak-tea, half-assed version of the Ryan plan that the White House is going to offer.

So don't fret, wingnuts. Boehner and company are fighting the good fight.


UPDATE: The WSJ chimes in:

[T]he Obama-Pelosi Leviathan wasn't built in a day, and it won't be cut down to size in one budget. Especially not in a fiscal year that only has six months left and with Democrats running the Senate and White House. Friday's deal cuts more spending in any single year than we can remember, $78 billion more than President Obama first proposed. Domestic discretionary spending grew by 6% in 2008, 11% in 2009 and 14% in 2010, but this year will fall by 4%. That's no small reversal.

The budget does this while holding the line against defense cuts that Democrats wanted and restoring the school voucher program for Washington, D.C. for thousands of poor children. Tom DeLay—the talk radio hero when he ran the House—never passed a budget close to this good.

Indeed.

Relax: the Budget Battle is Just Beginning.

I'm not going to comment on the "Shutdown"-avoiding budget deal that Boehner and Reid cobbled together on Friday night. If you consider $38.5 billion in budget cuts too little, you're right. If you think Boehner showed spunk in dealing with the Senate and White House, you may be right. If you think the GOP has sold us all down the river for not getting $eleventy-trillion, you might need to take a breath:

The accomplishment set the stage for even tougher confrontations. Republicans intend to pass a 2012 budget through the House next week that calls for sweeping changes in Medicare and Medicaid and would cut domestic programs deeply in an attempt to gain control over soaring deficits.
And the Treasury has told Congress it must vote to raise the debt limit by summer — a request that Republicans hope to use to force Obama to accept long-term deficit-reduction measures.

Now we have a complete year's worth of budget to make the kind of gigantoid cuts that the Tea Party wants to see. And yeah, a good bit of that won't make it through the Senate, and it's anyone's guess as to whether Obama will sign it if it does. But Boehner has demonstrated that he can get Reid to cut more than he wants to, and that Obama will be largely irrelevant to the procedure.

So keep the popcorn warm and the powder dry. The real show is about to begin.

83 Cents on the Social Security Dollar? Where Do I Sign Up?

Alex Pollock has crafted a plan to un-screw Social Security so simple, straightforward, and obviously beneficial that there's a virtual guaruntee that Congress will never consider the measure. It begins with a sound statement of reality:

If a debt cannot be paid, it will not be paid—at least not paid in full.

Everyone who has ever declared bankruptcy or dealt with a credit counseling firm knows this to be true. There is a point where liabilities stretch beyond future earnings. We have either hit this point already or sailing in full-steam, damn-the-torpedoes mode towards it.

Here's the plan:

You could stay in Social Security as it is. Or you could elect to settle for 83 cents, paid in U.S. Treasury inflation-indexed bonds, which you would own outright. These bonds, with all future interest payments on them, would constitute true retirement savings, protected from inflation.⁶ In exchange, you would forego formula benefits equal to the value of the bonds you received divided by 0.83. You would have made up your own mind about the chances of such promised Social Security benefits actually being paid.

I'd take it in a New York minute. So would most people, and every time that happens, Uncle Sugar finds his liability decreased. The essence of trade: both sides benefit.

So what's to stop it from happening? The greed of politicians for control over the lives of its citizens; the hunger to be seen as the cornucopia from which all good things flow. Why, if people have their own assets, we don't need to save them from themselves! Then what the hell are we going to do?

The Ryan Plan Sucks. We Still Need To Do It.

Nothing a politician does, however intelligent or well-meaning, will be without unpleasant or unintended consequences. This is so true as to be axiomatic. Thus, whatever benefits we will get from the Ryan Plan, people will be unhappy with it. People will have problems in their lives as a result of it. It doesn't go far enough for the libertarians, and it will cause the Left to howl like it's face is being ripped off with a sandpaper-bedecked spoon.

Whatever. This is the last chance our government will have to put its fiscal house in order. After this, we face 1 of 2 options:

1. Euro-style stagnation, complete with monstrously high taxes, permanent double-digit unemployment, and gradually collapsing demographics.
2. Civil War II: Bloodshed Bugaloo.

We don't want either, and I suspect the first will lead to the second rather quickly.

The Taxer we Raise, the Broker we Get

The Chinese have had this concept called the Dynastic Cycle for some time: a predictable rise and fall based on human nature and the inherent errors of monarchial government. A family rises to power, becomes corrupt, and falls. Time both seals later emperors in tradition and blocks them from the awareness of what they need to be. The result is the belief that they need do very little.

Monty, over at Ace of Spades:

Governments the world over are discovering that the river of money is not endless. That seemingly-inexhaustable mountain of wealth has been turned into an ocean of debt that will take decades to pay off. The spendthrift habits of the Western nations will put burdens on our children, and other generations not yet born, that should outrage us as a people. We are investing in the old rather than the young, and are punishing risk-taking and entrepreneurship rather than rewarding it. Our tax regimes seem to be deliberately crafted to kill innovation and long-term thinking. (What does "legacy" mean if the wealth I have accumulated in my life cannot be passed on to my children or heirs, but is instead eaten by the all-consuming government?) Young people -- young families -- are the foundation upon which Western Civilization is built. Neglect them, overburden them, cheat them, and you are committing societal suicide.

The premise of democracy is that the people, who live in the world and market, are far closer to reality than a prince sealed off by decorum and thick castle walls. That premise is about to be tested.

Read the whole thing.

UPDATE: "I need teens to be having more kids, pronto! Legitimate, illegitimate, I don’t care — somebody’s got to pay my Social Security."

Theorem: Chris Christie is the Greatest Politician in the History of the Universe.

Proof: (Hat Tip: Ace)

Gov Christie calls S-L columnist thin-skinned for inquiring about his 'confrontational tone'